Dubai plans reforms to its financial system
By Adam Schreck |
May 25, 2010, Tuesday
|
Print Edition
Print Edition
DUBAI officials are outlining plans for financial reforms in the wake of the emirate's credit crisis.
The governor of the Dubai International Financial Center, a state-run banking hub, said yesterday the United Arab Emirates federation is putting in place a "wide-ranging program" aimed at addressing shortcomings in the country's financial system.
"Although we expect a return to high economic growth, it is critical that we urgently address the deeper risks and challenges that the economic crisis has revealed," Ahmed Humaid al-Tayer told a banking forum in Dubai.
His comments came hours after the head of Dubai's supreme fiscal committee, Sheik Ahmed bin Saeed Al Maktoum, said the Emirates plans to implement a debt law and coordinating office to manage borrowing by government-related companies.
Dubai will create a similar office to coordinate debt decision-making on a local level, he said.
Debt problems with some of Dubai's state-linked firms, particularly the city-state's Dubai World conglomerate, sparked broader fears about the health of regional economies and the ability of government borrowers to repay their bills.
Dubai World's credit crisis also renewed concerns about the lack of transparency and extent of government support for lavish spending projects including soaring skyscrapers and man-made islands.
Dubai is one of seven semiautonomous states that make up the UAE federation. Unlike its wealthier neighbor Abu Dhabi, which hosts the country's capital, Dubai generates only a small fraction of its revenue from oil.
Sheik Ahmed, a top aide and uncle of Dubai's hereditary ruler, said the changes he outlined were among a number of "urgent steps" being taken on a federal level to address gaps in the country's legal and regulatory framework.
Emirati officials are also planning to update the country's largely untested insolvency laws, which analysts have cited as a concern in the light of Dubai's credit woes.
The governor of the Dubai International Financial Center, a state-run banking hub, said yesterday the United Arab Emirates federation is putting in place a "wide-ranging program" aimed at addressing shortcomings in the country's financial system.
"Although we expect a return to high economic growth, it is critical that we urgently address the deeper risks and challenges that the economic crisis has revealed," Ahmed Humaid al-Tayer told a banking forum in Dubai.
His comments came hours after the head of Dubai's supreme fiscal committee, Sheik Ahmed bin Saeed Al Maktoum, said the Emirates plans to implement a debt law and coordinating office to manage borrowing by government-related companies.
Dubai will create a similar office to coordinate debt decision-making on a local level, he said.
Debt problems with some of Dubai's state-linked firms, particularly the city-state's Dubai World conglomerate, sparked broader fears about the health of regional economies and the ability of government borrowers to repay their bills.
Dubai World's credit crisis also renewed concerns about the lack of transparency and extent of government support for lavish spending projects including soaring skyscrapers and man-made islands.
Dubai is one of seven semiautonomous states that make up the UAE federation. Unlike its wealthier neighbor Abu Dhabi, which hosts the country's capital, Dubai generates only a small fraction of its revenue from oil.
Sheik Ahmed, a top aide and uncle of Dubai's hereditary ruler, said the changes he outlined were among a number of "urgent steps" being taken on a federal level to address gaps in the country's legal and regulatory framework.
Emirati officials are also planning to update the country's largely untested insolvency laws, which analysts have cited as a concern in the light of Dubai's credit woes.
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